Government refuses loans to 71,600 low-income families in London - Liberal Democrats

2.54.10pm GMT Tue 3rd Feb 2009

71,600 pensioners and families in London had their application for a crisis loan turned down by the Government last year, figures highlighted by the Liberal Democrats have revealed.

Applications for the loans, aimed at low-income families and pensioners unable to get credit elsewhere, rose by more than 31% last year to 225,730. The figures come at a time when the Government is encouraging banks to increase lending.

Tom Brake MP, Shadow Minister for London said, "People who apply for crisis loans are desperate and have nowhere else to turn, yet too often they get turned away when they should be getting help.

"It is very worrying that with the recession hitting London hard, even more people will turn to the Government for help. Yet the evidence for the past year is that more and more people will be turned away by Government run Job Centre Plus.

"At a time when the Government is demanding that the banks lend more, here we have the Government itself doing the opposite.

"The Government has got to practice what it preaches to the banks and make more cash available to families through these loans."